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TMI Blog2014 (6) TMI 193X X X X Extracts X X X X X X X X Extracts X X X X ..... 004 and 07.07.2004 (CIQ report). It is not clear nor any attempt was made by the appellant to show that while conducting chemical analysis, what was the method adopted by the laboratory in China or what were the standards prescribed for collecting the samples and conducting chemical analysis there. The report of the chemical laboratory at China which has shown 0.27% more Fe content than what is prescribed. Admittedly, the show cause notice did not make any reference, direct or indirect to these reports. Therefore, in our opinion, the reports of laboratories in China are of no avail to the appellant to take their case any further. Even the other material which was relied upon by the Commissioner, was not disclosed/reflected in the show cause notice and in any case that would not help the appellants to contend that there was an admission on the part of the respondent-exporter that the Fe content of Iron Ore exported by them was more than 65%. As a matter of fact, respondent-exporter, right from inception has contended that the Fe content of Iron Ore exported by them was not more than 65%. - Decided against Revenue. - CSTA No. 7 of 2011 - - - Dated:- 20-3-2014 - DILIP B. BHOSAL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, Custom House, Cochin, after analysis of the samples covered by Test Memo No. 196 dated 25.5.2004 reported vide S-10/11/2004-05 Lab Customs L-148(M) on 18.06.2004, that the Fe content of Iron ore samples was 68.4%. Since the Fe content as per the chemical examiner, Custom House, Cochin, was on the higher side, the respondent-exporter requested for retest of the samples at the Central Revenue Control Laboratory (CRCL), New Delhi. The laboratory at Delhi, vide its letter dated 01.03.2005, confirmed the Fe content in the subject consignment as 67.3%. Admittedly, Export and Import Policy 2002-2007 had restricted export of Iron Ore containing Fe content,-above 65% and permitted it only through Metals and Minerals Trading Corporation (MMTC) and under licence issued by Director General of Foreign Trade (DGFT). 5. In the present case, the respondent-exporter had exported the consignment under Export Licence No.0001718 dated 10.03.2004, wherein, they were permitted to export Iron Ore Fines containing Fe + 64-65%. Since the Fe content of Iron Ore exported by the respondent-exporter was found to be more than 65%, in exercise of the powers conferred under Chapter XIII of the Act, a show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be heard in person before the case is decided. If no reply is received within the stipulated time or if they fail to appear for the personal hearing fixed for the case, the case will be decided on the basis of evidence on record without any further reference to them. 9. This notice is issued without any prejudice to any other action taken under this Act or any other Act or Law for the time being in force in the Union of India. 7. The respondent-exporter contested the show cause notice. The Commissioner in the course of hearing of the case, seem to have made reference to the report of chemical examiner at the receiving port in China and so also to some other documents which admittedly were not referred to in the show cause notice. Based on that material, the Commissioner passed the order dated 31.08.2006 imposing penalty of Rs.25 lakhs on the respondent-exporter under Section 114 of the Customs Act. The Commissioner held that the Iron Ore exported by the respondent-exporter contain more than 65% Fe content and since it was not permissible under the export licence produced by the respondent-exporter, imposed the penalty under Section 114 of the Act. 8. The CE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions contained in Section 124 of the Act and also other relevant provisions. Chapter XIII of the Act deals with searches, seizure and arrest. This Chapter contains Sections 100-110A. From bare perusal of the provisions contained in this Chapter, it is clear that the concerned authorities are conferred with lot of powers and suppose to follow several stages before confiscation of goods attempted to be improperly exported. Section 100 empowers to search suspected persons entering or leaving India. Section 102 provides that a person to be searched is required to be taken before the Gazetted Officer of the Customs or Magistrate. Section 104 empowers the concerned authority to arrest any person in India, if commits any offence punishable under Sections 132, 133, 135, 135A and 136 of the Act. Section 105 empowers to search the premises. Section 106 confers power to stop and search conveyances. Section 107 empowers to examine persons in the course of any enquiry in connection with smuggling of any goods. The concerned authority has a power under Section 108 to summon persons to give evidence and produce documents in any enquiry, which the concerned officer is making under the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he material, on which the Commissioner relied upon to hold that the Fe content of Iron Ore samples was more than 65%, was admittedly not referred to/mentioned/disclosed in the show cause notice. In other words, the grounds on which the Commissioner relied upon to hold that the Fe content of Iron Ore was more than 65% and imposed penalty on the basis thereof, were not the grounds mentioned in the show cause notice dated 13.12.2005. This has not been disputed by learned counsel for the appellants. In this view of the matter, we do not find any reason to interfere with the order passed by the CESTAT which has rightly set aside the order of the Commissioner. 16. The contention urged by learned counsel for the appellant that in the course of enquiry, it was open to the Commissioner to consider and deal with all the material that was disclosed, though it was not referred to in the show cause notice, deserves to be rejected out right. If this submission is accepted, it would also amount to violation of principles of natural justice. Section 124 of the Act clearly provides that notice should disclose all the grounds on which it is proposed to confiscate the goods or impose penalty. Even ..... X X X X Extracts X X X X X X X X Extracts X X X X
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